According to speakers at the Industry of Things World Asia event, companies in the region lack an understanding of the Industrial Internet of Things (IIoT), a shortcoming set to undermine any moves to implement Industry 4.0 protocols.

One of the highlights of this year's event was the official release of the findings of a pan-Asian survey into the uptake of Industry 4.0, supposedly the next phase in the digitisation of manufacturing. Tellingly, the top three concerns, as expressed by Asia-based manufacturers, were cost (58% of all respondents), access to necessary infrastructure (56%) and potential risk (55%).

More worryingly, the survey revealed clear gaps in understanding, with 30% of respondents agreeing with the statement that "they had no real sense as to what the Industrial Internet of Things (IIoT) was and no grasp of why it mattered". Furthermore, only 25% indicated that they were evaluating how the IIoT may "improve production/operational processes, products or services".

The biggest challenge, though, was seen as coming from the 30% who considered themselves "uncertain as to the likely ROI" or felt there was "a lack of a clear business case" with regard to IIoT. In light of this, it was perhaps unsurprising that 39% of all respondents agreed that "very few people in their industry understood what IIoT was all about". This, perhaps, explains why 56% of those surveyed had no budget allocated for smart manufacturing.

Putting this into perspective, Colin Koh, a former President of the Singapore Industrial Automation Association, said: "At best, SMEs are on Industry 3.0 or even 2.0. They lack the infrastructure and internal resources to upgrade to 4.0. The question, then, is – how do we bring IT to the shop floor?

"Well, as a first step, low-cost controllers can be installed as a means of delivering initial savings. With this as a starting point, SMEs can then proceed higher up the value chain. The next problem, though, is that many system integrator professionals in Asia have clear gaps in their knowledge.

"The big boys – most notably IBM – need to take a lead in training system integrators. Overall, a considerable effort needs to be made and this will require government backing in terms of guidance and support. At present, many factory workers have a low exposure to IT, so the IoT concept is completely lost on them. We need to bring in younger guys, with the appropriate skills, to help manage the transition."

Looking at things from more of a China perspective, Li Haihua, Deputy Chief Technical Officer of the China Academy of Information and Communications Technology, said: "While a number of the mainland's leading companies – notably Alibaba, Baidu and Tencent – are always quick to grasp the latest innovations, for many other businesses across China, Industry 1.0, 2.0 and 3.0 pretty much co-exist, with most factories yet to have even introduced IP-based networking.

"While tens of millions of SMEs across China currently lack the technology and knowledge to deploy IIoT, the 13th Five-Year Plan [China's economic blueprint for 2016-2020] has designated accelerating digitisation across China as a priority. In line with this, IoT architectural standards were established in September last year. It also worth remembering that China is the world's largest IoT market – some US$4 trillion in value terms."

The topic of standards was again addressed by Stefan Hoppe, Vice-president of the OPC Foundation, the Arizona-based body that promotes interoperability standards for data exchange in an industrial environment. Looking to the future, he said: "Within the next five years, we will establish the minimum requirements for any company to be deemed Industry 4.0 compliant.

"As of this year, there are already 35,000 OPC-compatible products, representing a total of 47 million devices. By 2018, we're hoping to raise that to 52,000 products and 120 million devices. In the case of China, it has already adopted a number of OPC protocols, with many more scheduled for implementation in 2018."

Robotic integration at DHL.

Robotic integration at DHL.

China: The world's biggest IoT market.

China: The world's biggest IoT market.

It was left to Peter Zornio, Chief Technology Officer of Emerson Automation Solutions, a Missouri-headquartered automation specialist, to address the issue of return on investment, a concern raised by many of the survey respondents. Making the financial case for Industry 4.0, he said: "Even today, many plants still manually collect data and inspect machinery and assets, with only critical machines digitally monitored. There is also the problem that little of this manually acquired data is ever acted upon in a timely fashion.

"Every year, the global manufacturing industry loses about US$1 trillion on account of suboptimal operating performances. IIoT could mitigate this, giving more comprehensive feedback and allowing operators to intervene more effectively. This deployment of digital technology would deliver a 20% saving on operating costs and increase utilisation by up to 10%, all the while cutting maintenance costs by 50%, reducing accidents by 30%, using 30% less energy and resulting in a 30% fall in emission levels."

For Domonkos Gaspar, Global Head of IT Program Management for Autoneum, the Zuriich-heaquartered automotive components giant, the challenge of moving to Industry 4.0 was not technology-related, but more of a personnel issue. Highlighting this, he said: "Human resource management (HRM) is one of the key issues that needs to be addressed. Essentially, any successful Industry 4.0 transformation can only come about through properly implemented HRM.

"It is down to HRM to monitor and lead cultural change, while being responsive to rapidly changing scenarios. It also needs to be agile in terms of the establishment and enforcement of regulations, guidelines and compliance. Above all, it needs to properly integrate with the larger eco-system, all the while managing a high volume of staff turnover and the accompanying training requirements."

Looking at the possible downside of the wider uptake of IIoT, Justin Nga, Commercial Engineering Director for Belden, the Missouri-headquartered networking specialist, identified security as a particular concern, saying: "Between now and 2020, there will be a 22% compound annual growth rate [CAGR] in the number of connected devices. Already, though, some 46% of organisations have a chronic shortage of cybersecurity professionals on their books. Overall, there's a global shortage of such personnel, with at least one million additional people needing to be trained and recruited.

"Essentially, companies need to put in place solutions that integrate the security threat landscape across endpoints and networks in the IT, as well as the operational technology (OT), environments. Today, 20% of cyber-attacks are intentional, with responsibility roughly evenly split between hackers and disgruntled employees. This indicates that 80% of all such attacks are unintentional, typically caused by software flaws, malware or operator errors."

Looking at a specific case study, Timothy Kooi, an Innovation Leader at the DHL Asia-Pacific Innovation Centre, explained how his company was already in the process of transforming itself. Identifying a number of factors that had triggered the move, he said: "Across the global economy, labour shortages are driving the wider integration of robotics, with cheap electronics and the availability of greater funding proving additional spurs.

"As a traditionally labour-intensive business, we have turned to robotics as a means of boosting worker productivity. This has seen a number of functions now wholly or partly given over to robots, including trailer and container unloading, sorting, picking, packing and even the folding of boxes. At the same time, we are also using data analytics to enhance work flow and space optimisation. Ultimately, our goal is to move up the value chain, shifting from descriptive analytics ("What happened?") and diagnostic analytics ('Why did it happen?'), to predictive analytics ('What will happen?') and prescriptive analytics ('How can we make this happen?')."

As a final thought, Maciej Kranz, Strategic Innovations Vice-president for Cisco Systems, the California-based networking giant, outlined the approach companies should take in terms of their own IIoT evolution, saying: "Dream big, but start small. Transforming your business is not a one-time event, but rather a multi-year programme.

"It is important to attract and train new and existing talent, while focusing on solving real problems, starting with the low-hanging fruit. You also need the relevant statistics in order to prove your business case and ensure senior management support. It's then a question of integrating technology solutions with business processes and building a partner eco-system. Ultimately, it's as much about transforming the culture as the technology."

Zornio: “The deployment of digital technology could cut maintenance costs by up to 50%.”

Zornio: “The deployment of digital technology could cut maintenance costs by up to 50%.”

Industry of Things World Asia 2017 was held on 3-4 July at the Marina Bay Sands Congress Center in Singapore.

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